Score Workshops Live your dream. Score can help. Marketing and Sales V2.3-1 Score Local Chapter 116 www.score-suncoast.org 941-955-1029 Score National Headquarters www.score.org 1-800-634-0245
4 Manasota SCORE Workshops Handouts Visual #1 Visual #2 Visual #3 Small Business Start-up and Management Guide Available for $15 1 Starting or Buying a Business Overview 2 3 4 Business Planning Marketing & Sales Financing
Business Plan Outline (Typical) 3 5 7 9 11 13 16 20 24 26 • Table of Contents (Easy Reference) • Executive Summary . . . . . . . . . . • Company Description & Mission • Products and Services . . . . . . . . • Marketing Plan . . . . . . . . . . . . . . . • Operational Plan . . . . . . . . . . . . . • Management and Organization . • Personal Financial Statement . . . • Start-up Expenses & Capitalization • Financial Plan . . . . . . . . . . . . . . . . • Appendices . . . . . . . . . . . . . . . . . . Marketing & Sales
Planning is Key to Success • Run business by hard facts rather than intuition • Business Plan provides all the planning detail • Relevant Business Plan Contents: - Market segment addressed - Target market - Products and Services to be provided - Customer service and support - Promotional activities - Competitive analysis - Pricing tactics What are the differences between Marketing and Sales?
Marketing Perspectives • Customer Perspective: Product or service being offered best solves my overall needs - Quality, Price, Availability, Dependability, etc. • Your Perspective: Differentiating your product or service to maximize its profit potential
Marketing Definition 5 Critical Elements • Your product or service • Your market • Your consumer • Your customer • Your competition Why is the customer not necessarily the consumer?
Value of Information to be Collected How much detail is required for informed decision? Detail B A Higher Cost Better Business Decision? What special information do you need tomake a better business decision?
Gaining an Competitive Edge • Consumer shopping behavior: • - What & why do they buy? • - Where do they shop & how often? • - How much do they spend? • Category purchase behavior: • - Who buys? Individual Decision, Family Decision? • - What brands do they consider? • - Do price points & deals influence purchasing • - How do they buy? Cash, Credit, Layaway? • Consumer attitudes & opinions: • - Convenience • - Shopping Environment • - Why item not needed
Market Research • Target Market: • - Identify customers & potential customers • Competitors • Market Offer - Product, Price, Distribution, & Promotion • Franchise
Market Research Process • Systematic collection and analysis of data • Transformed into information for decision making: • - Answer marketing questions. • - Assist solving marketing problems. • - Help in writing marketing plans.
Market Research Strategies • Researching market is easiest way to gain insight • Does not have to be costly, or complex process: • -Analyzing available data: • Demographics: Population growth/decline rate;age range, sex, income/educational level • - Surveying your potential customers • - Brainstorming with family and friends • - Interviews with potential customers
Typical Research Questions • What would be our market share? • How long would it take to reach this target? • Would people prefer a square pizza or round one? • If prices went up, would sales go down? • Which ad campaign would be most effective: - Newspapers - Radio - Direct Mailing Coupons What unique research questions would apply to your business opportunity?
Primary Data Sources Observational Data: • Mechanical • Electronic • Personal • Mystery Shopper Questionnaire Data: • In-depth interviews • Focus groups • Mall intercepts • Web Surveys Contact Methods: • Personal Interview • Mail • Telephone • Web based • e-mail
Secondary Data Sources Internal company data: • Customer data bases • Old research reports • Strategic marketing plans • Government sources: • • Census of population • • Census of retail trade • • Census of business • • Surveys of Minority Businesses • Women-Owned Businesses Commercial sources: • Media Data Info • Nielsen Retail Index • Arbitron • Internet: www.emarketer.com www.freedemograhics.com www.marketresearch.com Professional Publications: • Advertising Age • American Demographics • Wall Street Journal • Sales & Marketing Management • Trade Associations • Chamber of Commerce
Sperlings Best Places www.bestplaces.net (free service)
Tips on Simple Market Research • Ask your potential customers for suggestions • Provide information cards for customers to complete • Review trade association studies and periodicals • Review government Information - Census data, local economic development, etc. • Join local organizations such as Chamber of Commerce • Analyze important information already at your fingertips
Market Definitions & Analysis Compete for Same Market Expand Demand in Market Current Market Opportunities for All Offerings Current Market Opportunities for All Offerings Competitor B Competitor B Competitor A Competitor A Share & Compete Share Expand & Compete Why purchase from your business rather than competitors? Purchasers End Users
Your Target Market Should include important “marketing” questions like: • What are key characteristics of your market? Size? Varying Demand? Regional? • What needs does this market fulfill? • Is the market growing or declining? • In what segment of the market will your product/service compete? • Will your product/service change the market? Strongest selling points about yourplanned market offering?
Target Market Description • Demographic (Census Data): • - Age • - Sex • - Profession • - Income level • - Educational level • Geographic (Market Location): • - Zip code • - City, State
Questions Regarding Target Customer • What do you know about your customers? • How much will they purchase and when? • What needs or wants are not currently met? • Will your offering meet their special needs? Have you had any discussions withcustomers to obtain their point of view?
Questions Regarding the “End-User” • Who is the consumer? - Is purchaser the also the consumer? • What are the special needs of the consumer? • What unique things can meet special needs? - Ease of use - Quality and reliability - Convenience of support - Packaging - Pricing
Competitive Analysis • Who are your competitors? • What are their strengths and weaknesses? • Does your product/service address one or more of competitors weaknesses? • Future Scenario Possibility:- Competitor changes that could lower your sales - Your plan to deal with this competitive likelihood? Have you explored current level of customer satisfaction with competitors?
Product or Service Offering • Describe your product or service • - Position in the Marketspace (Product Image) • - Primary Selling Points • Sales Forecast ($’s and Units) • - Industry • - Geographic Area • - Your Company • - By Product or Service
Retail Operations • Location, Location, Location !!! - Be as close to your customer as possible. • Customer Demographics: - Age, sex, income, etc. • Signage: - Readable - Explains business clearly • Storefront Appearance - Parking, safety, loading, etc.
Supply & Distribution Channels Distributors: - Who are they? - Where located - Image, Service, Reputation - Contract arrangements Suppliers: - Consistency - Quality - Reliability - Credit
Distribution Strategy Questions • How are similar products distributed? • How much inventory on hand? • Does customer pickup or do you deliver? • Do you need sales representatives?
Internet Marketing • Product/service easily understood - most users are impatient • Internet Site easy to find and navigate • Professional development assistance • Payment process - most use credit cards or PayPal • Shipping for products - most use UPS or Fed Ex • Customer service and returns Have you considered using the Internet as a key part of your marketing strategy?
Pricing Strategy INFLOW • Pricing points: • - Below competition • - Above competition • - Equal to competition • - Variable pricing • Retail costs & expenses • - Material costs • - Labor costs • - Overhead costs • - Service • Breakeven Analysis - Price x Quantity Sold OUTFLOW - Expenses to run business
Pricing Strategy Questions • Total cost to produce your product or service? • Can you make a profit at your price? • Price of competitive products/services? • Creative ways to get higher price? - Change size, improve quality, add features . . . • Reduce costs to enable lower price
Promoting Your Product or Service • Advertising and Sales Promotions - Exhibit in Trade Shows to create interest • Customer endorsements & incentives for references • Tie in with other products or services • Bonus Pack - Coupons and BOGO offers • Short term price decline What are the risks of a short-termprice decline to stimulate sales?
Advertising • Newspapers: weekly, local papers • Mailers: can localize area • Radio: cost depends on station and times • TV: some local possibilities • Look for media that reaches your customer Can become a major expense item for a new business!
Marketing Budgets Costs Allocated by Category • Product or Service Promotion • Advertising materials • Sales and Commissions • Franchise (if applicable)
Product or Service Summary • Presentation or Advertisement - Descriptive, informative & accurate • Stress uniqueness of your offering • Describe how product or service satisfies your customers’ specific needs
AIDA Sales Strategy • A – Attention (create awareness) • I – Interest (create emotional appeal) • D – Desire (value and need) • A - Action (close order)
“After the Sale” Customer Service • Is customer satisfied with purchase? • Give all complaints top priority • Follow up sales with inquiries • Learn customer status before competition
Sales Summary Effective sales requires attention,common sense and creative thinking • Prepare for sale cycle based on Marketing Plan • Know your company’s strengths & weaknesses • Know your competitor’s strengths & weaknesses • Never be satisfied with Status Quo Why is it so important to constantly improve your product/service offering?
Score Workshops Small Business Start-up and Management Guide Lots of valuable information for only $15 Live your dream. Score can help. Score Workshops • Starting/Buying New Business • Building Your Business Plan • Financing Your Business • Marketing & Sales Visit www.score-suncoast.org For dates & location